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Facts
The assessee's appeals were initially barred by limitation, but the delay was condoned. For AY 2019-20 and 2020-21, the Assessing Officer (AO) treated the claimed salary income and other sources income as unexplained money under section 69A, disallowing standard deduction due to lack of proof of employment and business transactions. For AY 2021-22 and 2022-23, the AO made additions related to cash seized and income declared under the presumptive tax scheme (Section 44AD), treating them as unexplained money.
Held
The Tribunal condoned the delay in filing the appeals. For AY 2019-20 and 2020-21, the Tribunal upheld the orders of the lower authorities, dismissing the appeals as the assessee failed to provide cogent evidence for salary income and commission/brokerage. However, for AY 2021-22 and 2022-23, the Tribunal found that the assessee had provided sufficient evidence for rice trading business and had offered income on a presumptive basis under Section 44AD, hence additions under Section 69A were not justified and resulted in double taxation.
Key Issues
Whether claimed salary and business income, without sufficient supporting evidence, can be treated as unexplained money under Section 69A; applicability of Section 69A when income is offered under the presumptive taxation scheme of Section 44AD.
Sections Cited
69A, 139(1), 131(1A), 131, 132A, 147, 148, 143(2), 142(1), 44AD, 143(1), 143(3)
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “D” BENCH, KOLKATA
Before: SHRI RAJESH KUMAR, AM & SHRIPRADIP KUMAR CHOUBEY, JM
These are the appeals preferred by the assessee against the orders of the Commissioner of Income-tax (Appeals), Kolkata- 27(hereinafter referred to as the “Ld. CIT(A)”] even dated for A.Y. 19- 20 & 2020-21 dated 26.06.2025, A.Y. 2021-22 dated 27.06.2025 and A.Y. 2022-23 dated 28.06.2025.
At the outset, we note that the appeals of the assessee are barred by limitation by 74 days in appeal nos. 2629 to 2631/KOL/2025 and 44 days in appeal no. 2632/KOL/2025. At the time of hearing the counsel of the assessee explained the reasons for delay in filing the appeals. The Ld. D.R did raise objection to the condoning the delay. After hearing the rival contentions and perusing the materials A.Y. 2019- At the time of hearing the ld. Counsel for the assessee pressed only ground no.4 and 5, which is against the upholding the order of the ld. AO, wherein the standard deduction claimed of ₹40,000/- from the gross salary of ₹4,72,600/- in the ITR was denied and income was treated as unexplained money u/s 69A of the Act.
3.1. The facts in brief are that the assessee has not filed any return of income for the impugned assessment year u/s 139(1) of the Act. The directorate of income tax (Investigation), Kolkata received information from office in-charge, Burrabazar Police Station, Kolkata on 20.07.2021 that cash amounting to ₹25,00,000/- (Twenty-Five Lakh only) has been intercepted from the possession of one Shri Bholanath Shaw on 16.07.2021. Subsequently, summon u/s 131(1A) of the Act issued to Shri Bholanath Shaw and his sworn statement was recorded on 04.08.2021,wherein he stated that cash belong to his employer Shri Raj Singh, the assessee. Accordingly, the statement of Shri Raj Singh, was recorded on 13.08.2021, u/s 131 of the Income-tax Act, 1961 (the Act), wherein he stated that the aforesaid cash seized of ₹25.00 lacs belong to him and it was derived as sale proceed from sale of rice in his business, Kolkata by his employer through Shri Bholanath Shaw from certain customers. The ld. AO noted that the Raj Singh did not produce any evidences in support of his averment. Consequently, the cash was handed over to the investigation wing vide order of the Hon'ble Court of ld. ACMM, 3.2. In the appellate proceedings, the ld. CIT (A) dismissed the appeal of the assessee by holding that the assessee has failed to prove the veracity of income and standard deduction was rightly disallowed by the ld. Assessing Officer, thereby upholding the order of the ld. AO, wherein the entire income was treated as unexplained money u/s 69A of the Act.
3.3. After hearing the rival contentions and perusing the materials available on record, we find that the assessee has derived a very meagre income of ₹1,34,000/- but the assessee failed to produce any cogent evidences qua the salary income and the details of commission and brokerage received. Consequently, we uphold the order of the ld. CIT (A) by dismissing the appeal of the assessee.
A.Y. 2020- The issue raised in this appeal is similar to one as decided by us in for A.Y. 2019-20. Accordingly, our decision would, mutatis mutandis, apply to this appeal of assessee in for A.Y. 2020-21. Hence, the appeal of assessee is dismissed.
5.1. The facts of the case have already been related above while deciding the for A.Y. 2019-20 and therefore, the same are not reiterated for the sake of duplicacy. The assessee filed the return of income on 29.07.2022, declaring total income of ₹4,40,600/-, which was processed u/s 143(1) of the Act on 05.01.2023. The other facts are same as discussed in ITA No. 2629/KOL/2025. The assessee had shown business income of ₹3,15,600/- under presumptive basis u/s 44AD of the Act and miscellaneous receipt of ₹1,25,000/- as income from other sources. According to the ld. AO although the assessee has reported income u/s 44AD of the Act but has not reported any financial particulars of his business-like own capital, secured loans, unsecured loans advances and other liabilities, fixed assets, inventories, sundry debtors, cash at bank, cash in hand, loans and advances etc. as on 31.03.2022. Notice u/s 143(2) and 142(1) of the Act along with questionnaire were issued. The assessee replied the said notices on 06.02.2024, submitting the information comprising ITR acknowledgement, computation of total income, profit and loss 5.2. The ld. CIT (A) in the appellate proceedings simply affirming the order of the ld. Assessing Officer 5.3. After hearing the rival contentions and perusing the materials available on record, we find that the assessee during the assessment proceedings furnished before the ld. AO the copy of confirmation, bills, vouchers, details of suppliers of rice as well as various evidences to prove that assessee was in fact carrying on the business of trading in rice. The ld. AO disbelieved the entire submissions of the assessee that the assessee was trading in rice. We have examined the evidences before us and find that M/s Sonamoni Agro Food 5.3.1. We find that the assessee filed the income under presumptive tax scheme u/s 44AD of the Act and therefore, the 6.1. We have heard the rival contentions and perusing the material available on record and find that undisputedly the assessee has filed the return of income u/s 44AD of the Act on presumptive basis declaring the total income of ₹4,71,500/- comprising ₹2,35,600/- as profit on presumptive basis on total sales of ₹22,35,800/- and income from other sources of ₹2,41,500/-. Since, we have already accepted the business of the assessee of rice trading in IT No. 2632/KOL/2025 for A.Y. 2022-23(supra). Therefore, our finding in that for A.Y. 2022-23(supra)would, mutatis mutandis, apply to this appeal of assessee as well. Consequently, we hold that the assessee is engaged in the business of rice trading. The appeal is allowed.
In the result, the appeals of the assessee for A.Y. 2019-20 and A.Y. 2020-21 are dismissed whereas the appeals in A.Y. 2021-22 and A.Y. 2022-23 are allowed.
Order pronounced in the open court on 02.04.2026.